
Riink. H 9; T 




^^^^^^^^^ /.*^2r^ 




■ v: 

^^ THE COMMERCIAL SIDE OF TERRITORIAL EXPANSION. 




SPEECH 



OF 



HON. WM. M: HOWARD, 



OF GEORGIA, 



IN THE 



HOUSE OF REPRESENTATIVES, 



>^^ i.^ 



Wednesday, March 14, 1900. 



WASHINGXOM. 

I 900. 



£"7/3 



I 



P. 

Cong-. Ree^-d Of r, 



■J 



SPEECH 

OF 

HON. WILLIAM M. HOWARD, 



The House being in Committee of the Whole House on the state of tha 
Union and having under consideration the bill (H R. 91*^) making appropria- 
tions to provide for the expenses of the government of the District of Colum- 
bia for the fiscal year ending June 30, 19U1, and for other purposes- 
Mr. BENTON said: 

Mr. Chairman: I yield so much of one hour as he may desire 
to the gentleman from Georgia [Mr. Howard] . 

Mr. HOWARD. Mr. Chairman, we are now, perhaps, well be- 
yond the sentimental stage of our victory over Spain, and thought- 
ful people are no longer willing to solve the problems that confront 
us as the legacy of that war by the patriotic exclamation, " Who 
will haul down the flag? " nor will they accept as an accurate 
measurement of our responsibilities the mystical solution that it 
is "destiny." 

Whether the inhabitants of Puerto Rico and the Philippine Is- 
lands are citizens of the United States, or whether the Constitu- 
tion guarantees to them a republican form of government, or 
whether the tariff and excise tax laws apply equally to all the 
territory of the United States, or whether these islands may be 
held perpetually as colonies, without the right of statehood, and 
many other problems not yet suggested by this new and strange 
relation, alien to the spirit of 1776 and repugnant to the Declara- 
tion of Independence and unprovided for "in the Constitution, are 
questions too vital, too momentous, to be solved with phrases. 

The decision to go to war with Spain was suddenly made, not- 
withstanding the long-continued existence of the causes which 
we proclaimed as justifying hostilities, and the public mind was 
as little prepared for the ready comprehension of the consequences 
of victory as was our Government for the conflict; and it was, 
therefore, but natural that the hysteria of our exultation should 
be prolonged by mysticism on the part of those who conceived 
that the golden opportunity was present to convert a war begun 
for humanity into one of conquest for commercial gain. The 
change of purpose was as radical as it was sudden, and involved 
our plighted faith to the world and with each other. 

No matter that Europe was not deceived, we ourselves believed 
that our motives were honorable, and that we fought to restore 
peace and establish liberty where despotism was reveling in a 
carnival of death. In July, when the blood of our heroes was yet 
wet on San Juan Hill, we spurned the suggestion of indemnity as 
4238 3 



a taint upon our honor, and in December at Paris we were stifling 
the protest of our prostrate foe with a bribe of gold that Europe 
might not hear her cries while we stripped her of the Philippines. 
It is no wonder; then, that the succeeding chapter in our history- 
was written in the Delphic phrases, "Who will haul down the 
flag? " " It is our destiny," "God has given them to us." 

it is not my purpose to enter at this time into a discussion of 
any of the problems which the permanent retention of Puerto 
Rico and the Philippines involve, except that of commercial ex- 
pansion. There are now many people in the United States who 
believe they see in the annexation of Cuba and the permanent re- 
tention of Puerto Hico and the Philippines vast opportunities for 
the expansion of our commerce, and who for the saije of this sup- 
posed advantage will justify and defend a policy which results in 
the permanent retention of these islands. 

Waiving all considerations of right and wrong involved in the 
policy oi retention, and passing the question of the constitutional 
power to maintain a colonial system and of the resultant effect on 
our republican form of government of a colonial system, I shall 
discuss the question of commercial expansion involved in this new 
condition from a purely commercial standpoint of profit and loss. 
Whether it is desirable that grave questions of constitutional gov- 
ernment should ever be considered from the standpoint of com- 
mercial gain, the fact is that every male citizen in the United 
States, not legally disqualified, is by virtue of his power to vote a 
lawmaker, and whether he will preserve existing institutions or 
overturn them is a matter of his own will, and those who would 
overturn settled policies must be met at the threshold of such a 
controversy on their own ground, though they choose it in the 
lower levels of selfishness and gi'eed. 

If this Government is to remain a Republic, the people will be 
responsible for it; if it is to be converted into an empire, the people 
will be responsible for that; and this being so, it is the part of 
wisdom to talk about the things some of the people are thinking 
about. It is safe to say that if the commerce with the Philippine 
Islands was the limit of the possibilities for commercial expansion 
in the East, the question of their permanent retention would have 
been settled long ago against such a ijolicy. The average annual 
aggregate of the imports and exports of the islands for a period of 
ten years, ending with the year 1898, is $33,000,000. If every dol- 
lar of this commerce was with the United States and every dollar 
of it was profit, it would not pay the expenses of a civil and orderly 
government in the islands. 

It will be remembered that the argument which finally won a 
majority for the annexation of the Sandwich Islands was that it 
would aid in the extension of our commerce in the East. The 
undisguised truth is that our commercial ambition aims at com- 
mercial conquest in Asia, and the Philippines are regarded as of 
secondary importance in themselves, but as a necessary foothold 
from which to cast our commercial lines into the supposed stag- 
nant pools of China. The problem, when considered from existing 
commercial and political conditions, is easy of solution. 

Three views may be taken of the commercial aspect of Cuba, 
Puerto Rico, and the Philippines: First, our imports from them; 
second, our exports to them, and, third, the loss to us from main- 
taining government for them and the loss to our own industries 
and labor from their unrestricted competition. We import an- 

■4238 



nually about $250,000,000 of tropical products, chiefly sugar, cof- 
fee, tropical fruits, nuts, rubber, fibers, spices, and cabinet woods, 
and it is supposed that these islands are capable of supplying most 
of them. All of these islands produce cane sugar, tobacco, cabi- 
net \voodi3, coffee, and tropical fruits. The Philippines produce 
hemp. The total commerce of these islands for the years in which 
their commerce reached its highest point is as follows: 

Commerce of Cuba^ Puerto Rico, Hawaiian Islands, and Philippine Islands, and 
share of United States therein. 





Year. 


Imports. 


Country. 


Total. 


From United 
States. 


Per cent 

of United 

States. 


Cuba 


1893 
189C 
1898 
1896 


$52,101,683 

3,656,578 

11,650,890 

38,815,075 


$17,180,362 

794,774 

8,695,591 

1162,446 


33 04 


Puerto Rico* 


21 74 


Hawaiian Islands . . 


74 65 


Philippine Islands 


.55 


Total 


96,234,225 


26,833,173 












Year. 


Exports. 


Country. 


Total. 


To United 

States. 


Per cent 

of United 

States. 


Cuba 


1893 
1896 
1898 
1896 


$83,018,338 

3,668,351 

17,346,744 

33,481,484 


$77,931,671 

510, 4a5 

17,256,084 

1 4, 982, 857 


93 90 


Puerto Rico* 


13 93 


Hawaiian Islands 


99 44 


Philippine Islands 


14.90 


Total 


137,514,807 


100,681,097 












Year. 


Total imports and exports. 


Country. 


Total. 


Part 

of United 

States. 


Per cent 

of United 

States. 


Cuba 


1893 
1896 
1898 
1896 


$135,119,910 

7, 334, 929 

38,997,634 

63, 396, 559 


$9.5,112,033 

1,305,259 

25,951,678 

5,145,303 


70 45 


Puerto Rico* 


17 83 


Hawaiian Islands . 


93 35 


Philippine Islands 


8.30 


Total 


233,739,032 


127,514,273 











* From Almanach de Gotha. t From United States reports. 

And their total purchases were $96,224,225, of which amount we 
sold them $26,833,173. For the same years they sold products 
amounting to $137,514,807. and of this amount we took $101), 681.- 
097, showing a balance of trade against us of $r3.847,924. The 
exports of these islands, especially from Cuba and the Philippines, 
may be largely increased and th^ir imports also increased, and the 
proportion of imports from the United States should from tlie new 
conditions be largely increased. 

It is also true that they can produce much more of the tropical 

produce which we consume, but it must be borne in mind that if 

we get all our tropical supplies from these islands, dropping the 

other tropical markets in which we now purchase more than half 

4133 



6 

of the total, to the extent that commerce is reciprocal, we shall 
lose a large part of our sales to the countries from which we no 
longer buy. But if we stimulate an increased production of sugar 
and tobacco in these islands, we are thereby competing with the 
production of beet and cane sugar and tobacco in the States and 
with little advantage to the natives, because on the sugar and 
coffee estates of these islands the labor is not all done by the na- 
tives, but by the Portuguese, Italian, Chinese, and Japanese labor- 
ers imported to these islands as laborers. 

In all these purely tropical islands in the Atlantic and the Pacific 
the native labor is unreliable and incapable of meeting the re- 
quirements of successful industry, agricultural and mechanical, 
and importations to supply their defects only increase their pov- 
erty by supplanting them with the laboring classes of other coun- 
tries. It has been for years the settled policy of the United States 
to restrict and in some instances prohibit the importation into our 
own States of this class of labor in order to protect our common 
labor. 

If this is wise for us, just to our laboring element, a contrary 
policy is unwise and unjust to the people of these islands, and in 
its last analysis the competition is that of the coolie contract 
labor with the free labor of the States in the production of sugar 
and tobacco. It is no reply to say that the island tobacco, being 
better than ours, does not really compete with it. Their best to- 
bacco is better than ours and hence does not compete, but they 
now raise and will raise still more of a grade of tobacco which is 
not better than ours that will compete with us. 

Nor will it do to say that the cane and beet sugar industry of 
the States yields so small a per cent of the total consumed that 
our industries will not be affected; the price for our sugar is fixed 
by the price of theirs ; besides the beet-sugar industry in the United 
States promises in the future to supply our home market. Ger- 
many and France not only supply their home market, but export 
largely of beet sugar. The fact is that beet sugar supplies two- 
thirds of the sugar consumed in the world, and the adaptability 
of sections of the West and the South to its production promises 
some relief from the unprofitable production of cotton and wheat. 

Cotton was formerly grown in the Philippines and maybe grown 
there again, and while you add this industry to those existing in 
the islands you increase the production of a staple the price of 
which, when a normal crop is made in the United States, is below 
the cost of production, bringing distress and want to many of the 
people now dependent upon that branch of agriculture. The con- 
suming power of these islands is estimated at about one hundred 
millions, but generally stated, they will consume as much as they 
can pay for. 

Now, it is well known that sugar and coffee are being sold at 
prices so low as to leave no margin of profit to the producers. In 
1893 Brazilian coffee brought 14 cents per pound, and in 1899, 7 
cents. In 1878 sugar sold for 5 cents per pound, and in 1897 for 
2 cents. The sugar of these islands is cane and not beet sugar, 
and except where cane sagar is produced under exceptionally 
favorable conditions of high cultivation, cheap and reliable labor, 
and expensive machinery, it is not profitable. Hemp from Manila 
is produced in competition with sisal hemp from Yucatan, in the 
south of Mexico, the Bahamas, and other tropical places within 
500 miles of our coast. 

4238 



Indian jute is a strong competitor with hemp. It is, therefore, 
plain that sugar and coffee, the largest natural products of these 
islands, ■will not jdeld such returns as make their production 
generall J" profitable, and the result will be that the inhabitants of 
these islands, depending on these staples for their support, will 
derive but a meager subsistence from them and can not become 
large consumers of imported goods. Puerto Rico buys as much 
as she sells. If every dollar she exported was profit, it would not 
meet the demands of the island for governmental expenses deemed 
necessary to a proper administration of her affairs. 

An important item for which our taxes must pay will be the 
increased Army and Navy fortifications, coaling stations, civil 
establishment, submarine cables, the loss of full or partial duties 
on the importations from the islands into the United States, 
amounting to many million dollars. This duty lost in one way 
must be made up in another, and as the loss falls on our Treasury 
it must be replenished from our pockets. We have not been long 
enough in the business to have an itemized record of expenses, 
but in time that will be forthcoming, when no man need be in 
doubt as to the mistake we will make from the financial stand- 
point. 

It is the history of all the colonial possessions of the world that 
only about 40 per cent of their imports and exports are with the 
mother countries. English colonies in the Atlantic are in more 
or less distress because of the low prices their products bring. 
Dutch colonies in the Pacific are in distress from the same causes. 
Spanish colonies in the Atlantic and Pacific were in distress and 
revolt, and British India is more flourishing in Bombay and Cal- 
cutta than in the rural districts of India. 

The fact is that agriculture throughout the world is depressed 
and unremunerative. The producer of raw products of any kind 
everywhere is deriving from his labor only a scanty living. And 
with this depression in these islands— depression from inevitably 
low prices and the depression added by the ravages of war — their 
rehabilitation under any form of government is a task not only 
involving us in difficulty but expense. As a business proposition 
it is cheaper to buy from these and other countries what we need 
of their sugar, coffee, and tobacco at such price as the market 
fixes and leave their government and condition to themselves. 
They will buy all the cotton goods and provisions and iron and 
steel and machinery from us that they are able to pay for, because 
we can sell and transport them cheaper than any other country. 

That a few individuals or corporations may secure franchises 
and monopolize a few lines of industry will in no wise compensate 
the masses of taxpayers for their outlay in maintaining govern- 
ment in and for these islands. The probabilities are that we 
should be able to buy hemp from Mexico cheaper than from an 
American colony, where the product was monopolized by a trust. 
Certainly the freight rates from Mexico would be less than the rate 
from Manila. 

Before entering into the discussion of the extent and character 
of the Asiatic commerce of the United States and the possibilities 
of its extension, it might be well to state the aggregate of the do- 
mestic exports of the United States for the last three years, during 
which they have reached the highest point in the history of our 
country, in order to see more clearly what the relative value of 
the Asiatic market is. In 1897 our domestic exports reached 
4338 



8 



$1,032,007,603, and in 1898 they exceeded the preceding year by 
$178,28 4,310, and in 1899 they reached the enormous aggregate of 
SI. 232 903 987. 

Of the export business of 1899, agriculture constituted 62.42 per 
cent of the whole; manufactures, 30.39 per cent; products of the 
mine, 2.66 per cent; products of the forest, 3.80 per cent; fisheries, 
0.4.3 per cent; and miscellaneous, 0.28 per cent. A closer analysis 
of this export trade will be highly instructive and to my purpose. 
We sold to Europe, $959,234,520; to North America, $168,854,567; 
to South America, $37,421,700; to Africa, $18,602,394; to Oceania, 
§37,542,936; and to Asia, including China, $53,843,554. 

Inasmuch as the inquiry is directed to the maintenance and ex- 
tension of our commerce in the East, I shall drop at this point all 
other data except that relating to Asia and Oceania, as compris- 
ing the field of Pacific or eastern commerce, for no one will pre- 
tend that it is either desirable or necessary to retain the Philip- 
pines in order to maintain or extend our commerce with British 
North America, Mexico, Central and South America, Europe, or 
Africa, and as the inquiry narrows geographically it should be 
enlarged commercially and politically, or, what is the same thing, 
it should become more minute and specific in detail as to eastern 
commerce and eastern political conditions. There can be but one 
apology for inflicting the House with this mass of detail, and that 
is to be found in the supreme importance of the question involved. 

Shall we change from a Republic to an empire for the trade of 
the Orient? Shall we quadruple our standing Army? Shall we 
build a navy adequate to the task of defending a trans-Pacific de- 
pendency? Shall we add to the annual burden of governmental 
expense $200,000,000 for the sake of extending our trade in the 
East? Roughly speaking, these are some of the consequences in- 
volved in the step proposed to be taken by the permanent reten- 
tion of the Philippine Islands, and to whomsoever it should seem 
that it is more agreeable to take the risk than to examine the 
facts, to such an one I confess my argument can not be made en- 

As commerce in the comprehensive sense is composed of imports 
as well as exports, I shall adduce the imports into and the exports 
from Asia and Oceania in their more minute geographical and 
political divisions and for the years of 1897, 1898, and 1899, because 
these years mark the highest point of our export trade, and hence 
afford a fairer and broader basis from which to make ;.deduc- 
tions. 



Country. 



ASIA. 

Aden 

China 

Cbinii: 

British 

German 

Russian 

East Indies: 

British 

Dutch 

French 

Portuguese 



Imports from Asia and 
Oceania. 



1897. 



:.'3, 087,740 



^3,334,.']00 
17,388,40::; 



33,540,,53fi 
12, 830, 278 



1898. 



29, 168, 838 
13,418,827 



1899. 



$1,6.52,948 
24,190,476 

4,760 



38,386,09' 

32,308,633 

4 

9 



Experts to Asia and 
Oceania. 



1897. 



$027, 463 
11,370,289 



1898. 



4,451,896 

1,412,895 

104,643 



$744. 
12,258, 



18C9. 



§1,417,685 
15,225,294 



4,079, 

1,222, 

86, 



W, 203 
194, 183 

4, .510, 346 

1,6.52,604 

100,563 



Coxintry- 



Imports from Asia and 
Oceania. 



1897. 



1898. 



1899. 



Exports to Asia and 
Oceania. 



1897, 



1899. 



ASIA— cont'd. 



Hongkong 

Japan 

Korea 

Russia, Asiatic... 

Turkey in Asia 

All other Asia.. 



$929,054 
28,085,123 



$992,714 
23,259,486 



111,050 
3,581,307 

75,273 



113,537 

3,574,32(5 

60,005 



$2,399,943 

3t, 203, 587 

408 

57 

3,580,136 

130,871 



35,737,763 

16,009,471 

68,074 

454,640 

148,132 

311,893 



Total Asia . . 

OCEAKTA. 

Auckland, Fiji, etc 
B ri t i s h Austral- 
asia 

French Oceania. .. 
German Oceania.. 
Guam 

Tonga, Samoa, etc 
Hawaiian Islands- 
Philippine Islands 

Total Oceania. 



93,896,750 



94,310,501 



130,863,919 



40,663,159 



5,858,613 

367,976 

4,594 

13,858 

78,946 

15,311,685 

4,353,181 



366,119 

5,671,110 
305,974 



1,630,373 

3,537,: 

348, 



53, 848 
10,587,317 
4, 099, 525 



10, 
47, 

33,188, 
4,903, 



25,987,853 



26,883,893 



32,656,083 



!6, 699, 514 

19,710,165 

170,108 

1,390,558 
241,334 
353,682 



787,719 
30,604,774 
138,099 
l,856,a55 
181,211 
155,519 



46,956,598 



5,197 

,413,408 

320, 731 

9,44r 

4,070 

43,356 

,478,334 

69,459 



10,635 



17,653, 

267, 

36, 

6, 

41. 

6,837, 

147, 



31,341,877 



.53,843,554 



13,549 

,143, .591 

330, 347 

15,190 



73,465 
305,581 
663,313 



24,981,163 



37, 542, ( 



Aggregating tlae imports from Asia for these three years, they 
show a total of $325,071, 1'^O; and aggregating the total imports 
from Oceania, they show a total of $141,463,311, and from both 
Asia and Oceania a total of $466,534,481, which we paid to these 
countries for their commodities. For the same period it appears 
that we sold to Asia $141,463,311, and to Oceania $83,865,976, and 
to both $235,329,287, making a balance of trade against tis of $341,- 
205,194. 

This volume of commerce is the result of existing conditions, 
conditions of peace, conditions uninfluenced by the Spanish war 
or the Philippine war or any change in the policy of our own 
Government, and may, therefore, be fairly taken as an index of 
our normal commercial possibilities. And it is this condition 
which ib is sought to improve, to expand, and, if need be, by the 
permanent retention of the Philippines under some form of do- 
minion by us, by some called a colonial or imperial system, by 
others a territorial system. ,.■,.■. 

My argument has nothing to do with the name by which the 
fact and form of retention shall be known. I am dealing with the 
motive that underlies the fact, the motive of commercial gam, 
commercial expansion, in the accomplishment of which retention 
is conceived to be a necessary step. Is it necessary? It is common 
to hear our objective spoken of here and to see it alluded to m all 
forms of print as "the East," "the Orient," "the Pacific," indi- 
cating a vague and uncertain notion of the specific thing aimed at. 
A considerable portion of Asia and Australasia cannot be affected 
one way or the other, whether we hold or release the Phihppmes, 
and for proof of this assertion these facts are relevant. 

England controls British India, Aden and Perira, Ceylon, 

Hongkong, Labuan, and the Straits Settlements in Asia; Fiji, New 

Guinea, New South Wales, New Zealand, Queensland, Australia, 

Tasmania in Australasia. France controls in Asia 197 SQ[uare 

4238 



10 

miles of India, Annam, Cambodia, Cochin China, and Tonking; 
and Germany controls in the Pacific Kaiser Wilhelmland, Bis- 
marck Archipelago, Solomon Islands, and the Marshall Islands. 
The Netherlands controls Java, Sumatra, parts of Borneo, and 
other islands of Oceania. Portugal controls in Asia, Goa in India, 
Diu, Indian Archipelago, and Macao in China. 

No man will contend that anything we might do with the Phil- 
ippines will alter the political or commercial status of any of 
these dependencies I have named of England, of France, of Ger- 
many, of the Netherlands, or Portugal. We will continue to buy 
jute buts and sell kerosene oil in India on the terms England lays 
down, and we must consult the Dutch tariffs for Java before we 
land our sewing machines or load their coffee. The political map 
of these countries is as fixed as their geographical position, and to 
change it we must whip somebody, and on this line it would be 
well to remember that we can whip no European power without 
the consent of Europe. 

In the case of Spain we had their tacit consent, but it applied 
only to that occasion and nation. We should not adopt it care- 
lessly as a European precedent applicable to any future predatory 
excursion we might desire to make. 

Inasmuch as our trade with these European colonies must de- 
pend in the future, as in the past, on laws which will not be affected 
by our setting up shop in the Philippines, they are necessarily with- 
di'awn from the further calculation of our trade relations with 
China. 

There are conditions surrounding China which may seem to 
justify our expectation of benefit from them, and that the Philip- 
pines, held permanently under our control, will materially enhance 
our opportunity to convert them to our advantage. This phase 
of the question demands, therefore, candid investigation and it 
will vitalize the statistics by enumerating the chief articles of im- 
port and export between the two countries. 

Imports into the United States from China for the years 1S07, 1S9S, and 1S09. 

Silk, raw aud manufactured $19,537,266 

Tea 17,912,933 

Wool 4,270,326 

Hides and skins 3,374,097 

Opium 2,697,393 

Rice 1,639,398 

Hats, bonnets 1,179,479 

Sugar 787,136 

Firecrackers 784,263 

Matting 718,835 

Furs 639,638 

Spices, etc 540,333 

Bristles 345,943 

Vegetables and essential oils 318,957 

Coffee.. 316,851 

Chemicals and drugs 351,208 

Cabinet ware 200,449 

Pickles and sauces 1.55,786 

Earthenware 95,260 

Palmleaf fans 87,368 

Fish 83,540 

Wearing apparel 75,798 

Distilled spirits 68,017 

Paper, and manufactures of 66,437 

Drugs 58,941 

Total 52,476,314 

And as many as 100 other articles of merchandise imported in 

4238 



11 

small amounts and vahied at $6,873,252, making the total impor- 
tation of §59,3-49,566. Compared with the total imports into' the 
United States from all countries for the same period, the China 
importations constitute barely 3 per cent of the whole. 

I shall give the principal lines and amounts of exports from the 
United States to China for the same three-year period: 

Mannfactures of cotton $23,457,301 

Ilhiminatiug and. lubricating oils 8,033,597 

Iron and steel and mani;factures of 2,173,050 

Tobacco and manufactures of 880,930 

Raw cotton 513,146 

Wooden ware, sash, doors, and blinds 476,023 

Total breadstuffs 321,545 

Provisions, including meat and dairy products - 215,283 

Malt and maltliquor 153,140 

Cliemicals, drugs, and medicines 152,885 

Carriages, cars, vehicles 113,593 

Fruits and nuts 73,665 

Instruments and apparatus for scientific purposes 71,147 

Clocks and watches 60,445 

Books, maps, engi-avings 61,804 

Paper and maniifactures of 58,246 

Other manufactures of cotton 51,669 

Leather and manufactures of 41,761 

Naval stores , 31,369 

Giinpowdor and other explosives - 34,378 

Agricultural implements 5,319 

Total 35,994,295 

The remaining articles of export, covering numerous small ship- 
ments, aggregate $352,085, making the total exports $36,346,380, 
which is a small fraction over 1 per cent of the total export trade 
of the United States for the same period. In brief, China sells to 
us less than 3 per cent of our foreign purchases and buys about 1 
per cent of our foreign sales. 

The expansion of our trade with China may be accomplished, 
first, by partially or wholly driving our rivals out of the Chinese 
market by the law of cheaper prices; second, by China increasing 
her demands for all imports, we supplying our proportionate share 
of this increased demand; third, following the example of Euro- 
pean nations, acquire a sphere of commercial influence in China 
and monopolize the trade it affords. 

The probability is that such expansion as we may experience 
will result in part from each of the first two methods indicated, 
and it becomes profitable to study the special lines in which we 
have either equal or superior advantages compared with our rivals. 
What, therefore, are the chief articles of importation into China? 
What countries now supply them? In what proportion and what 
advantages do these countries enjoy in comparison with each 
other in the production and transportation of these articles? The 
total value of imported merchandise into China, distinguishing 
principal countries whence imported, in 1898, is: 

Haikwan taels. 

United Kingdom ^,m-Z,m 

HongkoSg 97,214,000 

India. .- 19,136,000 

Straits Settlements ^'o??'SiS 

Australia and New Zealand 221,000 

South Africa and Mauritius 

British North America l,96e>,000 

Total British Empire 156, 118, OOP 

4238 



12 



Haikwan taels. 

United States 17,163,000 

Continent of Europe 10,a53,000 

Russian Manchuria 299,000 

Japan 27,376,000 

Macao 3,318,000 

Philippine Islands 14,000 

Cochin China, Tonqiiin, etc 923,000 

Siam 206,000 

Java and Sumatra 1, 445, 000 

Other countries 1,000,000 

m^f„i /Haikwan taels-. 209,579,000 
•^"^^^ IDollars 146,077,000 

And as trade is sometimes reciprocal, and where quality and 
prices are fairly well balanced habits and customs play an impor- 
tant part in maintaining established relations, I deem it important 
to show to what countries China sold her exports in 1898 and the 
value of them: 

Haikwan taels. 

United Kingdom 10,716,000 

Hongkong 62,084,000 

India 1,324,000 

Straits Settlements...., 3,153,000 

Australia and New Zealand 914,000 

South Africa and Mauritius 286,000 

British North America 368,000 



Total British Empire 77,844.000 



United States 11,987,000 

Continent of Europe (except Russia) 25,929,000 

Russia in Europe 5,005,000 

Russia in Asia 9,796,000 

Russian Manchuria 3.997,000 

Japan 16,093,000 

Macao 5,383,000 

Philippine Islands 86,000 

Cochin China, Tonquin, etc 781,000 

Siam 699,000 

Java and Sumatra 347,000 

Turkey in Asia, Persia, Egypt, Algeria, Aden, etc 2,093,000 



m„tal (Haikwan taels.. 159,037,000 
■^°^** tdollars 110,849,000 

It is of interest to further specialize these tables by treating in 
detail the trade in cotton, iron, steel, machinery, and oil. 

Imports into China during the year ISOS. 
[Figures of the Chinese customs authorities.] 



Articles. 


Value. 


Percent 
of total 
imports. 


Cotton, raw and manufactures 


$59,539,338 
3,915,647 
3,758,189 
1,301,375 

8,816,877 


38 4 


Iron and steel, and maiiulactures of 


3.25 


All other metals, and manufactures of 


3 42 


Machinery and millwork 


.84 


Kerosene oil 


5 7 







In computing Chinese values 1 haikwan tael was taken, equals 74 cents. 
4238 



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14 

This anal5'sis reveals the relation of each of the rivals to the 
trade of China, and, taking for a moment the view that political 
and commercial conditions remain in China what they now are, 
we appear to enjoy natural advantages over all of our rivals that 
should enable us to drive them out of China with our cotton, raw 
and manufactured, our iron and steel manufactures, breadstutfs, 
and provisions. In American oil the race is closer, for the field of 
production of our rivals, Russia and Sumatra, is geographically 
nearer the marlcet than our own. 

But the mastery in commerce naturally lies with that country 
having the clear advantage in cotton, iron and steel, breadstuffs, 
and provisions; and if we do not conquer, it is our own fault — the 
want of commercial enterprise and business sagacity. For true 
it is, as man now uses nature, we have in iron, coal, wheat, and 
cotton the weapons with which to conquer. These seem to be 
axioms: If England, France, Germany, Belgium, and Japan buy 
our raw cotton and manufacture and sell it to China at a profit, 
we should be able to manufacture and sell cotton to China more 
cheaply. 

The ocean freight rate is cheaper from New York to Hongkong 
and Shanghai than from Liverpool for cotton goods and machinery. 
A committee appointed to inquire into the condition of British 
trade in Hongkong reported on June G, 1896, stating, among other 
things: 

In this connection the committee wishes to make special reference to the 
advantages conferred on American cotton piece goods in the China market 
by the rate of freight charged by the conference steamers from New York to 
Hongkong and Shanghai, which averages from 25 shillings to 30 shillings (Sti 
to $7.30) per ton, as compared with 57 shillings 6 pence (nearly $11) from Lou- 
don and Liverpool outward. 

The same remarks apply to the shipment of machinery from the 
United States to China, the freight for which is about 40 per cent 
lower than that from British ports. 

I take it for granted that we make or can buy machinery for 
manufacturing cotton equal to that of any of our rivals. We save 
the freight on raw material, which they must pay; and if they 
have any advantage over us that we can not overcome, it must be 
in the labor cost in the manufacture. If our labor cost is too 
great to permit us to compete with our European and Asiatic 
rivals, and we will not consent to reduce wages to a level with 
theirs, then we have no right to complain that we do not control 
the Chinese market by underselling our rivals. 

If our real difficulty is the cost of American labor and the high 
level of it is a barrier to our successful command of the Chinese 
markets, will some one explain how this trouble is to be overcome 
by owning the Philippines? One solution suggests itself. The 
Filipinos are near akin to the Asiatics; they are near neighbors, 
and I assume they live as cheaply and work as cheaply and are as 
skillful as the Chinese or other Asiatics, and we can transfer our 
manufacturing plants to these islands and employ the skill and 
cheaper labor of these people in the manufacture of our raw cot- 
ton, iron, and steel, and thus compete with Europe and Japan in 
the Chinese markets. 

And in order to do this capital must be safe, and to insure this 
the Government must be stable, and to this end the United States 
must set up and maintain the government, not for the good, pri- 
marily, of the native Filipino, bt;t for the protection of capital 
there to be employed. Is this a rational explanation? Does this 
4:238 



15 

speak the real truth about what is intended? If so, to hold these 
islands for such purposes will be a blow at American labor, will 
depreciate American industry, and will tax the American people 
the added cost of maintaining a government over a people who 
thereby become the cheap competitors and destroyers of our labor, 
and at the expense of the class who are injured. 

What says New England, already alarmed by the longer hours 
of labor and the cheaper wages paid in Southern mills? What 
says the South, just awakening, after a sleep of a century, to the 
importance, the necessity, of manufacturing in the fields the cot- 
ton she produces? What say these sections to the wisdom of 
establishing and maintaining a government in the Philippines 
ijitended to rob them of the industry by which the one section 
has in part grown rich and the other now hopes to grow rich? 

The agricultural classes of the United States liave for thii-ty 
years borne the grievous burden of a protective tariff that infant 
industries should be built up and the American laborer paid 
wages which would not only compensate but dignify him; and 
now, forsooth, the agriculturist and the laborer are to pay the cost 
of their betrayal to the pauper wages of Malay rivals. The capi- 
tal invested in manufacturing saves itself, for it removes to the 
new field and leaves the high home labor idle. Will capital hesi- 
tate to do this? 

Already New England capital is being transferred from New 
England to the building of new mills in the South, where condi- 
tions are supposed to be more favorable to earning dividends. 
What will prevent the transfer of capital to the Philippines for 
like reasons? If the mill is being moved to the cotton field to save 
cost of transportation, why should not the mill be moved to the 
labor field to save cost of labor? Whether this will be done de- 
pends solely on two questions: Will the capital be as secure in 
the Philippines as in the United States? Is the labor cost in the 
Philippines sufficiently less to increase the profits? "Security" 
and "profit " are the only two words in the vocabulary of capital. 
But I am told that, compared with the total industrial population, 
only a small per cent will be afi'ected, etc. ; that they will be read- 
ily absorbed in other occupations, more gainful perhaps, and com- 
pared with the great loss to capital in cotton mills, unless this 
change is made, the sacrifice of labor is trifling. 

For the sake of the argument, admit this to be true as to New 
England. How is it true of the South? The South does not own 
all of the capital now employed in her mills. She has just begun 
manufacturing. She is not yet rich, and money is dear. These 
Southern mills are a greater boon to labor than they are to cap- 
ital, because they afford an opportunity to relieve the congestion 
of white labor on the farm. Farming has become profitless. 

Crops sell below the cost of production because of excessive i)ro- 
duction and the single gold standard. To withdraw from the 
Southern farmer this opportunity for diversified labor is to strike 
a more serious blow to the farmer than to the class who are in- 
vesting their capital in milling enterprises. The laboring white 
man in the South is being driven to the wall because labor and 
cotton are too cheap. 

Thenegroat his elbow, like the dark-skinrace allover the earth, 
will work cheaper because he can live cheaper than his white 
neighbor, and the industrial development which has now so hope- 
fully begun in the South offers some escape for the laboring white 
4238 



16 

man from the competition of the laboring black man. It will 
place the white man in the factory and workshop and leave the 
negro in the field. It will give an opportunity for the greater 
natural intelligence of the white man to laj^ its hand on the ma- 
chine and tlie less intelligence of the black man to keep his on the 
plow. 

The American labor engaged in agriculture has never derived 
any benefit from the tariii laws of either political part}', except it 
was engaged in the production of sugar or rice, and all that has 
ever been said and done to secure by tarifi" legislation an improve- 
ment of the condition of American labor does not apply to Ameri- 
can farm labor, and in the nature of things can not apply to it. 
The benefits to labor from any form of tariff, if there be such 
benefit, applies to the labor engaged in mechanical and not agri- 
cultural pursuits. 

In a different connection I shall show that the competition of 
Asiatic cheap labor does not stop at the mill, but will extend to 
the field, and if Asia fixes the cost for manufacturing a pound of 
cotton she will also fix the cost of producing a pound of cotton, 
and if the white farmer of the South is to be shut out from the 
mills by Asiatic competition the black farmer of the South will 
be driven from the fields by Asiatic competition, and that the con- 
flict thus produced is irreconcilable between the interests of capi- 
tal to earn large dividends and the interests of the laborer to earn 
remunerative wages. The wages of labor engaged in agriculture 
in the Southern States is less than in any other industry in the 
country, and the wages of similar labor in India, China, and Egypt 
is five to ten times less than that. 

To whatever extent this conflict is mitigated by mutual conces- 
sion in a common country governed by the same laws, no mitiga- 
tion becomes possible where the conditions tend to the immediate 
divorce of capital and labor. The conditions existing in the Ha- 
waiian Islands, where the capital engaged in the production of 
sugar and coffee ignores the native and imports by thousands 
contract Asiatic labor, and similar conditions which will obtain 
in Puerto Rico, in the Philippines, and in Cuba, all prove too 
conclusively that capital will not share its benefits with labor 
voluntarily whenever it can with impunity defy its demands. "We 
have but to reflect that even in the United States at times labor 
protects itself with a strike and capital protects itself with the 
Gatlinggun. 

The discussion of another phase of this question more appro- 
priately admits greater elaboration of this view. Japan furnishes 
some important lessons on the value of our Asiatic commerce and 
foreshadows the effect of Asiatic industrial competition and clearly 
points out the effect of transferring American capital to the 
Philippines to obtain there cheaper labor as a factor in our com- 
mercial expansion. 

In 1890 we exported raw cotton to Japan of the value of §85,211 
and in 1898, $7,435,526, and in 1899, $5,775,784. In 1897 we ex- 
ported $141,264 of cotton cloth to Japan and in 1899 only $33,828. 
Why this decrease in cotton cloth? It is found in the fact that at 
the end of 1898 Japan had in operation 1.108,404 spindles, an in- 
crease of 200 per cent in six years, and the rate of daily wages to 
males in her mills ranged from 7 cents to 35 cents, and the daily 
wages for females in the mills was from 6 cents to 17 cents, and 
while our sales of raw cotton fell off in 1899 about thirteen and a 
42o8 



17 

quarter million dollars, the sales of raw cotton by British India to 
Japan more than trebled since 1895. 

The raw cotton imported into Japan during the year 1897 
amounted to 306,485,892 pounds, valued at §21.810,107, of which 
we sold her $3,036,011; British India, $13,S«jg,189, and China, 
§4,817,988. It has been our habit to imagine that China and 
India grew not much besides heathens whom we should Chris- 
tianize, but the statistics show they raise and export some cotton 
also. The four principal islands of the group known as Japan 
comprise an area about equal to that of the State of California, 
with a population of 43,228,803, or an average of 292.7 per square 
mile. 

They produce and export rice, silk, and tea, and in minerals they 
have an abundance of coal, iron, and copper. Our trade with 
Japan shows a gratifying increase. In 1881 it was 6 per cent of 
her total importations, while in 1893 it is 15 per cent of the total 
importations, and in 1899 it reached a total of $17,158,970. Of this, 
raw cotton was the largest item and the next largest tobacco; 
illuminating oil, breadstuff s, and distilled spirits; iron and steel 
and their manufactures amounting to $3,000,000, the great pre- 
ponderance of our exiDorts being raw material. 

It is worthy of observation that raw material sells itself, and is 
dependent almost wholly on first cost and transportation charges, 
and a trade composed largely of it offers little to the manufac- 
turhig interests of the exporting country. It will be remembered 
that a few years ago, when the industrial development of Japan 
was first attracting the attention of the world, we became espe- 
cially alarmed in the United States lest her cheap labor and adop- 
tion of ]nodern methods and machinery would not flood our own 
markets with products of her manufactures. 

The late Mr. Dingley made a report to Congress on the subject 
of Japanese competition, from which I quote the following remedy: 

In the meantime our defense against the competition of the lower wage 
labor of Japan and other oriental countries, which have introduced or shall 
introduce machinery and factory methods of production, whatever may 
hare caused this low wage, a competition which will in part be offset by the 
inevitable rise of wages in Japan must be the same defense as that which, 
from 1861 to 1893, proved so effective against the competition of the iiroducts 
of the lower wage labor of Earope, viz, protective duties, or, if need be, the 
same as is employed to ward off the competition of imported products of 
convict labor, viz, prohibition of their importation. 

In other words, whenever any people manufacture cheaper than 
we do, their products shall be prohibited from importation. This 
policy on our part calls forth the law of retaliation by the country 
whose products we exclude, and since Mr. Dingley penned this re- 
port, in June, 1897, Japan has gone to the gold standard and a high 
protective tariff, in imitation of our example, with the certain re- 
sult that she will take nothing from us which she can herself pro- 
duce, and, while she keeps us out of her market, she is free with 
her cheaper labor to invade successfully those markets which we 
both strive to supply. 

But if the Philippines are to be governed bj' us as a colony, with 
laws different from those ai:>plicable to the United States, if the 
doors of the United States are to remain shut, but those of her col- 
ony open, the cheap labor of the Philippines, together with a low 
tariff or open-door policy, will be a decided discrimination in fa- 
vor of that American capital which prefers to employ itself there 
and is rendered secure by the taxes of the people of the United 
4238-3 



18 

States, who are permitted no such opporttinities or advantages. 
This system of colonial government places a premium on expatri- 
ation. 

But what Mr. Dingley said of Japan applies with equal force to 
China itself, whose industrial development I shall consider in its 
relation to our commerce and agriculture. 

The view we have had of commercial China for 1899 is the very 
exact one of a balance sheet of trade, but in reckoning the future 
of that Empire we should take into account political conditions 
and their probable consequences, geograpical situation, and the 
incidents of climate and soil, growth and production, ethnological 
conditions, as they import the traits, tendencies, and capabilities 
of a race, and more particularly the industrial potentiality of the 
Kingdom. The area of China within the wall, which extends some 
1,600 miles from the Gulf of Pechili to the Desert of Turkestan, 
is 60 per cent of that of the United States and her population is 
five times as great. 

She traces her history through forty centuries and boasts a civ- 
ilization older than the Egyptian dynasties. Nearly four centuries 
ago Confucius, her greatest philosopher, taught: 

■Wealth, gotten by improper ways will take its departure by the same. 

And a century later Mencius, his successor, said: 

I like life and I also like righteousness, but if I can not keen the two to- 
gether I will let life go and choose righteousness. 

And another wise man of China of this generation reminded an 
American audience in 1899 that — 

Civilization did not mean the possession of superior force and ample sup- 
ply of offensive and defensive weapons. A civilized nation should respect 
the rights of another nation, and in such a nation a man should respect the 
rights of his neighbor. 

A people who have taught and practiced such precepts through 
forty centuries are not to he despised as uncivilized. 

Lying between the twentieth and fiftieth parallels of north lati- 
tude, extending some higher north and far ther south than the United 
States, she has in her northern provinces the climate of our North- 
ern States, and in her southern provinces the milder and semi- 
tropical climate of our South Atlantic and Gulf States. Her east- 
ern shores are tempered with the warmer currents of the Pacific, 
and her northern and western borders are rimmed in by the lofty 
Himalayas and the Altai Mountains. Vast rivers, navigable for 
great distances, winding through alluvial plains, flow on to the sea. 

China presents all the variety of climate and fertility of; soil to 
be found in the United States. Cotton, rice, sugar, tobacco, tea, 
and silk are produced and exported. Coal, iron, gold, silver, cop- 
per, and mineral oil are found in quantities sufficient for her own 
consumption and for export, when developed. It is safe to say 
that in any resource of mineral wealth and vegetable productions 
China is as rich as the United States. The present and prospec- 
tive condition of tlie market for cotton and cotton goods in China 
is well stated in the report of the British commission which 
traveled through central and southern China during 189G and 
1897, and made to the British Parliament in 188S, Mr. F. S. A. 
Bourne being the head of the commission: 

In regard to wages, employers in China are at a great advantage. The 
truth is that a man of good physical and intellectual qualities, regai-ded 
merely as an economical factor, is turned out cheaper by the Chinese than 
by any other race. In the humbler moral qualities of patience, mental and 
physical, and perseverance in labor he is unrivaled. It seems probable that 
4233 



19 

under the leadership of skilled European managers and foremen of character 
and temper, firm, just, and reasonable, the Chinese cooly and his wife will 
make excellent textile factory hands. These millions of patient, reascnable 
workers are only wanting leaders to make them producers on a gigantic 
scale, and leaders they will most certainly find. 

All Western employers and overseers of Chinese agree that they excel in 
lightness and deftness, and they are well suited in physique and intelli- 
gence for work in cotton mills. They show extraordinary powers of endur- 
ance. Boys in the Hankow mill work through tho whole night without 
leaving the mill, with only a little rice congee by way of food. In regard to 
land the lower Yangtze Valley is as perfect a site for manufacturing indus- 
tries as can anywhere be found, with coal and iron in easy reach, a temperate 
climate, and good means of communication by water. Broadly speaking, 
China derives her supply of cotton from tho Yangtze Plain— i. e., 100 miles on 
either side of that river from Ichang to the sea. 

The Yangtze-Kiang is the most important river of China, and for the past 
year has been open to trade for a distance of 3,000 miles, and penetrates the 
most densely populated and wealthiest sections of the Empire, and in size 
and commercial importance rivals the Mississippi. In the Yangtze Valley 
waterways are numerous, and a number of steamship companies are running 
steamers regularly as far up as Ichang. 

The Germans and the French have investigated the conditions 
of commerce and manufacture in China, obtaining and reporting 
information similar to that obtained by the British commission. 
These commissions report that China is rich in copper, iron, lead, 
silver-bearing lead ores, tin, zinc, native silver, and oils, and has 
immense deposits of coal. The commission sees a great agricul- 
tural future in store for Tonkin, Cambodia, and Cochin China; 
that the exceedingly rich soil is capable of producing incalculable 
quantities of cotton, rice, silk, and coffee. The commission rec- 
ommends the establishment of mills and factories in China, co- 
operation with Chinese in the opening and management of mines, 
and the development of certain lines of agriculture. 

Lest these opinions be thought partial to European interests, I 
quote from the report of United States Consul-General Jernigan 
to the State Department. Writing from Shanghai, he says: 

The energy and skill of the American laborer fear no rival in his home 
markets, but a new civilization is lighting up China, and competition in Chi- 
nese markets for our manufactures will be one of the consequences. I have 
not failed to consider that civilization will increase the wants of the Chinese, 
but their progress may enable them to supply their wants. It is, therefore, 
competition in Chinese markets that is first to be feared. 

The success which has attended the cotton mills of Shanghai within a few 
years past has stimulated the formation of companies for similar enterprises 
elsewhere in China. The chief markets for American cotton manufactures 
in China are Manchuria and the three northern provinces of Tientsin, New- 
chwang, and Chefoo, which consume 90 per cent of our cotton exports to 
China. , . , , ^^ ^• 

In the south, where cotton is grown more extensively and more attention 
is given to its manufacture, the Chinese arc less willing to purchase the for- 
eign manufacture. There is now a valuable demand in the markets of China 
for the products of British and American looms; but when the desired qual- 
ity of cotton goods at present imported from Great Britain and tho United 
States can be manufactured in China from the products of her soil, it is un- 
reasonable to expect the importation from foreign countries to continue in 
such large quantities, and when the products can be produced in necessary 
quantity on the .«oil of China and at a far cheaper price, as well as manufac- 
tured in China at a far cheaper price, it is no longer a question that cotton 
grown and manufactured in China will supply the demand of Chinese for 
cotton goods. The soil of China is fertile, and Chinese are industrious and 
frugal, peaceably disposed, and natural business men. 

From the facts it seems inevitable that European countries, 
which import their raw cotton and manufacture and ship to China, 
will be the first to avail themselves of the natural skill and indus- 
try and cheaper wages of the Chinese by investing their cheap 
capital in cotton mills in China, and undertake in that way to 
insure to capital the profits of manufacture. That English, 
4,238 



20 



French, German, Japanese, and even American capital will invest 
in mills located in China is not a matter of j)rophecy, but an ac- 
complished fact. 

A large per cent of the mills in Japan were erected and owned 
by foreign capital, and in the respective spheres of commercial 
privilege granted by China to Russia, England, Germany, France, 
and Japan a steady flow of capital will pour, with what result to 
the labor at home, consequently deprived of employment, remains 
to be seen. It will be noted that our chief exports to China in the 
order of their importance are cotton, oil, iron and steel manu- 
factures, and tobacco. The opinions quoted show clearly that 
China will in the course of time supply her demands for cotton 
from her own production. 

Now let us examine the future of oil. American oil in China 
must compete with Russian oil, Sumatran oil, and later with oil of 
Chinese and Siberian production. This large item of export will 
increase or diminish according to the supply of the original fields 
of production and the cost of transportation, this being one of the 
products of nature so little affected by art that the condition of 
supply and transportation will control its distribution. The fol- 
lowing table shows the total amount of oil imjjorted into China 
for each of the years named and gives the histpry of American oil 
in China: 

Kerosene oil shijyped into China from 1SS8 to 1893. 



Year. 


American. 


Eussian. 


Sumatran. 


1888 


Gallons. 

16,61 
14,999,942 
23,591,113 
39.318,477 
3i; 884, 013 
36,720,382 
51,670,853 
23,055,940 
33,520,649 
48.212,505 
50,084,015 


Gallons. 
3,090 

5,655,471 
7,237,611 
10,000,903 
8,619,318 
13,386,198 
17,500,283 
26,566,979 
28,285,000 
36,934,135 
19,936,246 


Gallons. 


1889 




1890 




1891 




1892 




1893 




1894 


534,280 

2,393,035 

5,151,873 

14,213,278 

2(5 871 865 


1895 


1896... 


1897 


1898 







In 1899 American oil has dropped to 23,000,000 gallons, while 
Sumatran is known to have increased; but figures are not yet ob- 
tainable for Russian and Sumatran oil. The Russian and Suma- 
tran oil supply is nearer to China than the American, and while 
the quality of American oil is superior to that of its rivals, the 
transportation rates give the advantage to them. New oil sup- 
plies have been discovered in Siberia, which will find an outlet 
into China by Russia's great Siberian Railroad, and discoveries 
have been made in China of extensive oil fields, from which it 
would seem that tbe future of American oil in China, in Asia, and 
Australasia is by no means bright. 

Consul Bedloe, of Canton, says, in Consular Reports for 1898: 

Very rich petroleum -wells have been found near Chnngkinsr, which sug- 
gest endless possibilities in this line alone. These oil wells are said to be 
far superior to those discovered in Kyaochau, and more important than any 
yet worked by native methods; but they need foreign capital and manage- 
ment, with which, it is thought, they will yield colo.ssal quantities of oil. Of 
course what would be required to place the product on a sound commercial 
basis would be a big oil refinery. 

This discovery is very important, aud, in view of the oil wells in the Jap- 
4258 



21 

anese island of Formosa, and of other oil wells near the German possession 
of Kyaochau. ui the province of Shantung, our trade in American kerosene 
IS boiind to be affected iinless prompt efforts are made to control the output 
and, if possible, the trade in the Chinese product. "ui^yuu 

Iron and steel is being produced in larger quantities and more 
cheaply m the United States than any country in the world In 
1899 we produced thirteen and a half million tons of pig iron- 
England followed with nine and one-third million; Germany next' 
with eight and one-tenth million, and France next, with two and 
three-quarters million tons. And that country which leads in the 
production of iron and steel, economically, will control the export 
trade m these lines. 

Whatever the wealth of China may be in coal and iron ore, the 
tact IS fixed that the means of transportation are lacking to make 
her supply available, and however rich her resources in other min- 
erals, her transportation facilities must be practically complete 
and adequate before the economical handling of her own resources 
of this kind is practicable. 

More than this, the industries which are dependent on iron and 
steel require highly skilled and expensive labor, intricate processes 
of manufacture and expensive machinery, and, as a result. Chinas 
demand for steel rails, locomotives, steam and electrical millin"- 
and mining machinery will have to be drawn from those countries 
where the supply is greatest and products cheapest until her own 
resources are in a condition of economical development. The 
immediate demand of China for iron and steel products will be 
enormous. 

Let us look at the figures. Four hundred million peonle of 
China are now served by 350 miles of railroad, or less than 1 mile 
for each million people, whereas the United States, only 40 per 
cent greater m area than China proner and with 75,009,000 people, 
had m operation in 1897 184,603 miles, or 1 mile for each 406 of 
her population, representing 811,233,592,588. Contracts are either 
now let or concessions granted by the Chinese Government for tlie 
construction of 10,000 miles of railroad, and taking it that these 
roads may be constructed and equipped as cheaply on the average 
as American railways, and you will have an outlay of §025,000,000 
for material, skilled and ordinary labor, of vdiich total sum the 
Lnited States should get a fair share. 

In 1887 we built iii'the United States 12.878 miles of railway, 
and for the five years following an average of 4.500 per annum. 
In 1882 we built 11,569. and in 1881, 9,847 miles. There is no rea- 
son, then, why this prospective mileage may not be constructed 
withm five years in China, for the population is already at hand, 
through every portion of the Empire, to construct and operate 
and use the lines, and no climatic conditions prevail to hinder 
rapid construction. 

The construction of these 10,000 miles will only hasten .the con- 
struction of more, and as the first lines built will penetrate China's 
known stores of coal, iron, etc., such local development as follows 
railway construction will proceed bv leaps and bounds. Imagina- 
tion will outrun my suggestions, for tho"ught is, on such a theme, 
impatient of the hindrance of giving it expression. 

But in a few years the riot and rush of development will begin 
to localize itself, to feed on its own resources. 

Study the effect and it will probably be revealed that China is 
becoming independent of our iron and steel, our cotton and oil 
our (lour and tobacco. The demand for these products is behig 



22 

stipplied in the home market. We shall always have commerce 
with China. 

It is impossible to conceive of a time when an empire of 400,- 
000,000 people will or can supply all of their wants from or by 
their own industry or ingenuity, but very certain it is that our 
exports will not be very largely of those things which China her- 
self produces in abundance, and equally certain is it that what- 
ever shall comprise our export list, cotton, raw and manufactured, 
oil, refined, and the coarser and staple products of iron and steel 
will not figure largely in it once China has fairly developed her 
own resources in these items. 

But it may be suggested that the conservatism of the Chinaman 
will not hasten him to such activity as soon to threaten us. If 
the matter rested with the Chinaman I would agree with this 
view; but, unfortunately for us, the Englishman', the German, 
the Frenchman, the American has each carried and is carrying 
his money, his brains, his experience, his energy, his inventions, 
his machinery, his skill, his science into the very heart of China, 
and only asks the Chinese to permit him to set up shop and to 
permit him to have the profits of his labor, while he borrows the 
hands and feet and eyes of a few of the inhabitants to assist him. 
Listen to these names. Are any of them familiar in the history of 
American enterprise? 

The Railway Age recently gave the names of the Americans 
most prominently connected with an important railway enter- 
prise in China as Hugh J. Grant, Samuel Thomas, Thurlow Weed 
Barnes, of New York; George J. Bippers, of Indiana, and the 
Carnegie Steel Company, of Pennsylvania. The sum to be ad- 
vanced by this company is said to be $20,000,000 for the Canton- 
Hankow road, and §25,000,000 for the Hankow-Pekin road, and 
yet these only cover about 1,000 of the 10,000 miles under conces- 
sion. It was known that at the time of the death of the late Sena- 
tor Calvin Brice he was the head of a company said to control 
§100,000,000 of capital for operation in China, to make no mention 
of Russia, English, German, and French capitalists now operat- 
ing in China. 

Who doubts that the Standard Oil Company will get its hands 
on all the oil wells sunk in Asia? What is improbable about it? 
Cecil Rhodes is building a line of railway from Cape Town to 
Cairo, from north to south of the continent of Africa, a distance 
of 5,000 miles, through a country filled with savages, and some 
Frenchmen are projecting a line from the east coast of Africa to 
the west to intersect it. In Africa the country must first be civi- 
lized, then cultivated, then populated, to furnish business for the 
roads. The Chinese have been civilized four thousand years, their 
country is diligently and extensively, if not intelligently, culti- 
vated; they find a ready-made population of 400,000,000. 

To convert the Chinaman to Christianity may bo the work of 
another century, but the mission of capital being to realize profit, 
it will deal with the Chinamans country and his physical rather 
than his spiritual nature. No money will be spent there in enter- 
prises that are not based on his physical wants. The sudden 
transformation of China has a history which it would be well for 
us to understand, because then we shall comprehend the nature 
and extent of it. 

This history will show that our relation to the Philippines has 
had nothing to do with conditions in China, and whether the com- 

4238 



23 

mPTcial or political future of China can be affected by any relftr 
tion we may hereafter sustain to the Philippines is of vital im- 
portance in determining wisely for ourselves what that relation 
should be. China built around herself on the land side a literal 
wall, through which no entrance could be made for any purpose 
without her consent; on the ocean side her ports remained closed 
to the ships or people or commerce of all the nations of the earth 
for centuries, and this condition of isolation and policy of exclu- 
sion was first disrupted by Great Britain, as the result of her war 
with China, known as the opium war, which was terminated in 
1842 by a treaty of peace in which it was agreed that British sub- 
jects should be permitted to reside at the ports of Canton, Shang- 
hai, Amoy, Foochoo, and Ningpo, all located on the eastern coast, 
and that tliey might trade with whatever persons they pleased. 

In 18t4 Caleb Cushing was sent by President Tyler to'negotiate 
with the Chinese a treaty of amity and commerce, which was soon 
accomplished, thereby giving to American citizens the same rights 
as to trade enjoyed by the British at the five treaty ports just 
mentioned. A few months later a similar treaty was made with 
France, and the ports thus opened to commerce became known as 
treaty ports, which name has been applied to other ports, many of 
them far inland, opened from time to time by other treaties, until 
the whole number now reaches 30. Great as was this awakening 
of China, the real impulse of its present development was received 
from the treaty of Shimonoseki, made between Chhia and Japan 
in 1895, in conclusion of the war of that year between the two 
nations and followed by a treaty of commerce in 1896. 

The important features of these treaties were that they opened 
the waters of the principal rivers and canals to citizens of other 
nations, giving foreigners the right to purchase goods or produce 
in the interior of China, to rent warehouses without the payment 
of special taxes or exactions, and to engage freely in all kinds of 
manufacturing industries in the treaty ports; also to import all 
kinds of machinery, paying only the stipulated import duties 
thereon and upon products manufactured by them in China, pay- 
ing only such Inland transit dues as are leviable on imported mer- 
chandise. 

The privileges and benefits of this Chino- Japanese treaty iiiured 
to the benefit of the subjects of all other nations having full treaty 
relations with China, under the most-favored-nation clause of 
their treaties. The prompt result of this was the movement from 
all ports of the business world in the direction of China and the 
establishment of business and manufacturing industries, not only 
in the old treaty ports, but the new ones which were opened by 
the Japanese treaty and by subsequent action of the Chinese Gov- 
ernment. This was followed by other evidences of a disposition 
to adopt modern methods. 

Tfie railroad from Pekin to Tientsin was quickly completed by 
the Chinese Government and agreements made looking to the con- 
struction by foreign capital of other lines, thousands of miles in 
length; telegraphs were extended, electric roads, electric lights, 
and telephones introduced in the principal cities, mining and 
manufacturing concessions freely granted, and steamers under 
foreign control were given permission to penetrate to the interior 
limits of navigation on all the rivers of the provinces containing 
treaty ports. 
As the result of this, factories and business houses have been and 
4238 



24 

are being constructed, railroads are being built and projected, 
steam navigation lines are being multiplied and mines opened in 
the sections where iron and coal deposits are said to be the greatest 
in the known world. The Portuguese have controlled the island 
of Macao, near Canton, since 1537, and the British secured Hong- 
kong by the treaty of 1842. In the treaty with Japan it was stip- 
ulated that Japan should have the island of Formosa, off the cen- 
tral coast of China, and certain territory of the peninsula of 
Liaotong. 

To this Russia, France, and Germany objected, and Japan wag 
choked off Liaotung and accepted a money indemnity from China 
instead. In November, 1897, Germany seized the port of Kiao- 
Chou, on the northeastern coast of China, under pretext of obtain- 
ing satisfaction for the murder of German missionaries by China- 
men a short while before. This port she held with a part of her 
navy until China, yielding to the coercion, leased her by a treaty 
this port and adjacent territory for ninety-nine years, with the 
right to occupy, fortify, and quarter troops and establish a naval 
and coaling station. 

A month latei: Russia obtained permission for its naval squad- 
ron to winter at Port Arthur, and in JMarch, 1898, China agreed 
to lease to Russia for twenty-five years Port Arthur and Talien- 
Wan and 800 square miles of adjacent territory for the exclusive 
use of Russian and Chinese men-of-war. Russia was also granted 
the right to build a branch of her Siberian road through the de- 
pendency of Manchuria to Port Arthur and Talien-Wan and to 
quarter soldiers in the territory it traversed for its protection. 
This gave Russia the control of the entrance to the Gulf of Pe- 
chili, the gateway to Pekin, the capital of China. 

England, who has become accustomed to watching Russia at 
Khyber Pass, on the 2d of April following, secured a lease from 
China of the port of Wei-Hai- Wei, which is on the opposite (south) 
side of the Gulf of Pechili, England to remain in possession, in- 
cluding a strip of adjacent coast 10 miles in extent, so long as 
Russia occupied the Liaotung Peninsula, with the right to fortify, 
quarter troops, and do whatever Russia might be authorized to do. 

In J une England also secured a lease for ninety-nine years of 
200 square miles of the mainland opposite her island of Hongkong. 
Stimulated by these concessions, France, in April, 1898, secured a 
lease for ninety-nine years of the harbor of Kwang-Chau-Wan, in 
the Leichau Peninsula, on the southeastern coast, near the French 
possession of Tonkin, with the right to use the leased port as a 
French naval station and to connect the French territory of Ton- 
kin with the Chinese province of Yunnan. 

The lease carries exclusive mining jirivileges in the territory 
through which the proposed railroad is to be constructed, and by 
this agreement with France, England claimed the right to extend 
her Burmese railroad into the province of Yunnan, through an 
agreement made with China in 1896, by which all privileges 
granted to France or Great Britian in the province of Yunnan and 
Szechuan should be given to both countries. In March, 1899, Italy 
demanded similar concessions to be made to her in the port of San 
Mun, and in April Japan demanded similar concession on the 
coast opposite Formosa. 

The countries obtaining these concessions have announced that 
a portion of each of these ports shall be freely open to the com- 
merce of all nations. The Russian bear lies on the Liatung Pen- 
4238 



25 

insula, on the north coast of the Empire, and the British lion lies 
facing him at Weihaiwei. The German eagle is perched on Kiao 
Chou, the dragon of Japan at Formosa, the lion having a retreat 
at Hongkong and the tricolor flies at Kwang Chau Wan. The 
opium war opened five ports to a limited commerce and let in one 
foreign power, Great Britain, at Hongkong. 

The Japanese war let in five European powers and opened treaty 
ports, making the aggregate thirty, and made commerce free to 
the commercial powers of the world. Japan conquered an em- 
pire and got an island, and England, Russia, France, and Ger- 
many hold the Empire in trust for ninety- nine years. Whose shall 
the Empire be in the one hundredth year? Shall the American 
eagle, now resting in his flight on Luzon, fly on to Cathay? This, 
then, is in brief the opening of the door in China. Shall it remain 
open? That is one branch of the Eastern question, as known to 
European diplomacy. 

If treaty obligations are observed, the door will remain open 
and all the nations may go in or out at will. If treaty obligations 
are broken, the door will shut. Then who can, who will, open it? 
It is to aid in answering this last question that we are attempting 
the benevolent assimilation of the Filipinos. Who does not see 
it is blind? Who will not see it is foolish. It will be seen from 
the character of the treaties between China and the European 
powers that the sovereignty of China over the leased territory is 
in no instance parted with nor has the Empire surrendered in this 
territory entire political control, the exclusive rights granted being 
confined to naval and military occupation by "the lessees and to 
railroad and mining privileges. 
_ China professes that in no concession has she impaired the essen- 
tial commercial rights of any nation with whom she has treaty 
relations containing the most-favored nation clause, and that the 
lessees take their privileges in each instance subject to these rights 
of all other treaty po wers. So that so far as China's interpretation 
goes, it is her intention that each treaty nation have equal com- 
mercial privileges within her borders with every other nation with 
which she lias a treaty of amity and commerce. 

The CHAIRMAN. The time of the gentleman has expired. 

Mr. BENTON. I yield such further time as the gentleman 
desires to conclude his speech. 

Mr. HOWARD. It further seems that England, Russia, Ger- 
many, France, and Japan are disposed to treat their special treaty 
jDrivileges as exclusive only in those respects in which they were 
expressly intended so to be, and that in all commercial matters 
nations not parties to them may enjoy commercial privileges on 
equal terms with themselves. This is the open-door policy for 
which England has contended in the East. It is the maintenance 
of the full treaty rights of the United States with China which the 
press reports indicate our State Department has lately been 
endeavoring to secure by having the several powers who have ac- 
quired lease privileges in China to acknowledge and confirm them. 

If-treaties were never abrogated, if nations, as parties to them, 
regarded them alwa;ys as sacred and binding, if changed condi- 
tions never arose to prompt their violation, the existing conditions 
in China would bode no ill to American interests, and we might 
go forward in our commercial career with confidence in the per- 
manence and security of our rights. 

But that Russia shoiild garrison her troops and harbor her fleet 

4338 



2G 

for a quarter of a century in Manchuria and the Liatung Penin- 
sula, construct and operate her transcontinental railway with a 
Pacific terminus at Port Arthur, and not thereby so emphasize 
Riissian power and prowess in that portion of China's provinces 
and dependencies as to establish a dominent influence in trade as 
well as in politics, is to tax the credulity of men. 

Immediately south of Russia comes Great Britain, and south of 
her, Germany. Who can doubt what the effect of a century of mili- 
tary supremacy asserted by the Slav, the Saxon, and the Teiiton 
over the Mongolian will bring forth? Their commercial interests, 
sheltered by military power, will charge China in solid phalanx, 
as infantry rush to attack under the cover of batteries. Great 
Britain and France hem in the south, while doughty Japan guards 
the center. 

The interior is gridironed with railroads built by the capital of 
the nations, and millions of their capital is burrowing the earth 
for mineral wealth. It must resiilt that as China permits Europe 
to develop her resources under the protection of European armies 
quartered on her soil she will lose her power of resistance, and 
inch by inch of what she gives up is absorbed by the stronger 
power within her borders; and by this process political control 
■will naturally fall to the lot of those who have the power to en- 
force their will. 

England went into India and Africa and Egypt with a peddler's 
pack on her back, and to-day her Queen sits on the throne of the 
Mogul Empire as Empress of India and gathers the taxes in the 
Valley of the Nile, as did the Pharaohs, while in Africa she is blot- 
ting the only republic from her path wdth libations of British 
blood. 

And France and Italy have crossed the Mediterranean into 
Africa, into Asia, and the islands of the sea, and the German 
Empire extend^ beyond the seas. 

What is the commercial policy of England and France and Ger- 
many and Italy and Russia, both at home and in their colonies? 
England is free trade; the British Empire has a revenue tariff in 
Australia, India, and Africa, a protective and discriminative tariff 
in Canada: France, a protective tariff at home and a discriminat- 
ing and protective tariff in the colonies; Germany, a protective 
tariff at home and a discriminative tariff in her colonies; Russia, 
a protective tariff, discriminating by reciprocity. Europe holds 
and governs colonies for commercial advantage to the parent 
country. Philanthropy, civilization, are incidents of their control; 
profit is the object. 

If these observations accurately read current history, then re- 
turn to the situation in China and ask why are Russia and Eng- 
land and Germany and France in China under century leases, 
protected with their armies and navies? To propound the question 
is to answer it. The sphere of influence of each in China will be- 
come absolute first within the territory protected by their military 
l^ower; next to this their influence will become paramount in the 
adjacent territory in the direction of the least resistance. 

Russia will spread over Manchuria and north and east of the 
great wall and down toward India. Siberia and the Siberian 
railway guarantee this. France and England will grind against- 
each ottier like Alpine glaciers in southwestern China, England 
nioviiig with greater rapidity as she reaches the freer zone of the 
Yangtze Valley. Hongkong stands like Gibraltar for strategy. 

4233 



27 

Germany will cross the Grand Canal and press toward central 
China till she meets the resistance of England's approach from 
the south; and with regular gradation you mav derive from the 
sphere of physical power the sphere of political power, then the 
sphere of commercial power, which to become absolute must be 
exclusive. 

But for the present, for to-day, all is peace. ' ' Behold how beauti- 
ful and how pleasant it is for brethren to dwell together in unity." 
How long will the door of China remain open to the commerce of 
the United States? This depends immediately on this question, 
How long will the powers now in China be content with their 
present situation? How long will the conditions under which they 
entered remain unchanged? Will they be as harmonious after 
getting in as they were while going in? Are they naturally his- 
torically friendly, or are there rivalries amongst them? 

Has Russia designs on England's Indian empire, and is England 
for this reason watchful, even suspicious, of her? Has France 
forgiven Germany for Alsace-Lorraine and England for St. Helena? 
If so, why do they each maintain their magnificent armies? Are 
France and England traditional enemies? Is Germany England's 
rival in commerce, her rival for supremacy on the seas? History 
shows that these nations within China's gates are not friends. 
And to this chronic jealousy add the daily recurring irritation of 
commercial rivalry, and a future of peace is not a hopeful prospect. 

As long as the door remains open American commerce will 
enter freely and win all the rewards which quality and price 
will justify, and without cost to us as a government and without 
the aid of the Philippines. If, unhappily, the European powers 
concerned should close the door by any device whatever, then we 
shall be shut out; and how will we remedy the matter? Our rela- 
tion to the Philippines, I repeat, in no way contributed to the 
door being opened. Could we force it open if we permanently 
retained these islands? For if the islands are not worth retaining 
for themselves and are not necessary to maintain free commerce 
with China or Asia, it follows that we should not burden our- 
selves with their permanent government. 

If the powers in China act in concert in excluding all commerce 
except their own, the question is fairly presented whether we are 
sufficiently powerful to overcome their resistance by owning the 
Philippines. I take it that in our generation no American gov- 
ernment would inaugurate a war in a large sense offensive against 
England. Germany, Russia, and France. The question will not 
admit of argument. In that contingency we would discover 
honor and prosperity in peace. 

Let me now assume that the greater probability is from the re- 
lation between these powers that they may quarrel amongst them- 
selves; and if we were in possession of the Philippines, we should 
have an opportunity to be drawn into the quarrel on more favor- 
able terms than those just supposed, and with the fortunes of war 
more evenly balanced we could better afford its risks, and in this 
more hopeful view we keep the Philippine Islands; we will fortify 
and garrison the best harljors. build dry docks, equip coaling sta- 
tions, buil^ repair shops, and keep a fleet of war ships about our 
Asiatic station. 

American money is invested in China; American citizens have 
large interests there. The critical moment arrives, the diplo- 
matic triggers are set, we scan the situation, make choice of sides, 

4238 



28 

with whom or in wliafc particular combination the emergency will 
determine. If we win, we shall have a port, a si^here of influence, 
of our own. The prize is a rich one; we are eager for it; we pile 
coal in Luzon as high as the volcano of Taal; the triggers are 
sprung; war is on; Luzon is the base of American operations, and 
whatever the combination we are in, whoever our allies may be, 
sooner or later our base is an object of attack; to resist success- 
fully it must prove stronger than the assault. 

Should our base be destroyed, we are at least crippled. It may 
lead to defeat; if so, we withdraw gracefully, pay the indemnity, 
and console ourselves as best we may, and curse the hour we took 
the Philippines. If we win, a port of China is the reward. We 
select a port and whatever more may be agreed on. We fortify 
and garrison the port and garrison the territory taken; the Asiatic 
fleet must be enlarged; our new dependency governed. We are a 
world yiower now. We must aid in maintaining peace, if peace 
be profitable, or in waging more war, if war promises the greater 
advantage. We have attained to national manhood. We have at 
last overtaken our destiny. 

The Philippines were only the stepping-stone in the march. 
Ouir ships must outnumber our factories, if we would be respect- 
able in the company we keep, and our soldiers outnumber our 
voters, if we would not have trouble with our republican institu- 
tions. The taxes are burdensome, the civil list extravagant, the 
pension list the most liberal in the world. We renew a career of 
peace on a war footing. The Government is stronger than ever, 
because to govern others withoiit their consent requires some- 
thing more of concentrated i^ower than is required in a homo- 
geneous republic. 

Our Army is larger than ever; the White Squadron is to be seen 
in every sea, our flag in every zone. What have we accomplished 
for our commerceV We have added Puerto Rico, Cuba, Philip- 
pine Islands, a province or more in China, and if it was Russia 
that succumbed in the conflict, we will take some of her Siberian 
territory: or if it was England, we shall add islands in Austral- 
asia; or if it was France, we shall take some of her possessions, 
preferably in Africa, and should Germany be the unfortunate one, 
we will despoil her in the Pacific. This, then, is our gain for 
commerce, for our surplus wheat, cotton, oil, iron and steel, and 
their ananufactures. 

But the wheat fields of China and Siberia are nearer than our 
great Western plains, and they are tilled by Asiatic labor, with 
whose low wages our wheat growers would starve. The cotton 
fields of China are white with Asiatic staple, and the cotton of 
India is nearer than that of America, and by the law of cheaper 
products and cheaper transportation keeps American cotton out. 
When you have cut the Nicaragua Canal, Indian cotton is still 
cheaper in your new possessions in China than American. 

The coal and iron of China, developed by European and Ameri- 
can money and skill, is supplying the demand for iron and steel in 
our new domain, and Russian, Siberian, Sumatran, and Chinese oil 
is still in the hands of the old, or a new. Standard Oil Company, who 
find it cheaper to plug up American wells and supply Cliina from 
Chinese and other nearby vv^ells. And now for tlie first time the 
American farmer, the American miner, and the American factory 
hand learns that trade does not follow the flag, biit that capital 
doss, and leaves dear labor at home to pay the tax as best it can to 
fly the flag in a foreign land. 
4:.'38 



29 

Where is the imperialist.now? He has gone where he can prac- 
tice imperialism, where labor is cheap, raw material abundant, 
and men must work, but shall not vote. The great valley of the 
Mississippi is listless and the plains of the great West seem bare. 
But they will reduce the acreage in wheat and seed to the sugar 
beet. For what? To compete with the contract coolie labor of 
tropical Hawaii, Puerto Rico, Cuba, and the Philippines. The 
South may reduce her acreage of cotton and sow to tobacco. For 
what? To compete with Cuban and Philippine tobacco. 

Congress, like Parliament, will authorize a commission to in- 
vestigate and report upon the condition of agriculture in the 
States and the cause of distress amongst the agricultural classes, as 
Great Britain has done, as Germany has done, as France has done. 
The commission will report that prevailing prices will not pay the 
cost of production, and they recommend a bounty from the Fed- 
eral Treasury. This for a time may hush the cry of hunger and 
will call for heavier taxes. Bounties paid from taxes raised on 
consumption is sucking blood from the fingers to replenish the 
heart. 

What, then, does the balance sheet show? The total import and 
export trade of China for a year does not exceed §250,000,000. 
Now, if the United States absorbed every dollar of this commerce, 
driving every rival from her market and every dollar of this trade 
was profit, how does the account stand? 

For the year 1901 recommended appropriations for our Army 
are $128,000,000, and for our Navy $75,000,000, a total of $203,000,- 
000, taking no account of pensions incident to the Spanish and 
Philippine war. Add to this sum the past cost of the war, $250,- 
000,000, and allow for the commerce of the Philippines and Puerto 
Rico $30,000,000, which counts every dollar of their trade as profit, 
and the sheet is balanced against us by $175,000,000. 

But the Army is to be permanently increased, and the Navy is 
to be built to proportions commensurate with the responsibilities 
of our new obligations. If you double the existing Navy, which 
will make us then only a fourth-rate naval power, you double, at 
least, the present appropriation and double the present Army, and 
you at least double the present appropriation to $100,000,000. 

In other words, an army and navy adequate for the require- 
ments, with the attendant increase of pensions, civil government, 
and unforeseen expenses, will add to the cost of running this 
Government $500,000,000, or twice what it cost us in 1897, before 
the war with Spain, or twice as much as the aggregate of all the 
commerce of China, the Philippines, Puerto Rico, and Hawaii, if 
every dollar of their commerce was with us to the exclusion of every 
other commercial power in the world, and if every dollar of that 
commerce went into the pockets of American citizens as profit. 

Contrast the old way with the new, and how stupendous is the 
folly of It all. During a century of peace, leading the national 
life planned for us by our fathers, our export trade has reached 
$1,252,903,987, at a maximum expense for government of §500,- 
000,000, $150,000,000 of which is paid in pensions and purchases 
no service for the Government, and now it is proposed to abandon 
the ways of peace and conquer trade with force, and we increase 
the expense of Government from $500,000,000 to $1,000,000,000 for 
the sake of the opportunity to conquer the commerce of China, 
Puerto Rico, and the Philippines. [^^PPl^^^se.] 
4233 

o 



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